NATIONAL DEBT/STEVE MNUCHIN/TREASURY: “Treasury Secretary Steven Mnuchin told lawmakers Thursday [7-27-17] he has ‘no intent’ to prioritize certain government payments and delay others if Congress fails to raise the federal borrowing limit…
Government debt hit the statutory limit in mid-March, and Treasury has been using extraordinary measures since then to raise enough cash to keep paying the government’s bills. Mr. Mnuchin said he would be alerting Congress that his previous letter notifying them of such measures ‘will be extended through September.’
Mr. Mnuchin reiterated Wednesday in a separate hearing on Capitol Hill that Treasury can keep paying the government’s bills through September. The Congressional Budget Office has estimated Treasury could run out of room to keep making payments in full and on time in early or mid-March. After that, Congress would need to raise the limit or risk missing certain government payments.
Some Republicans, including White House budget director Mick Mulvaney when he was a member of Congress, have argued during previous debt limit showdowns that the government could keep making payments to bondholders and delay other payments, such as Social Security and veterans benefits, to avoid a technical default. Obama administration officials balked at such proposals at the time, arguing that markets would still view the strategy as a default.”
-Kate Davidson, “Mnuchin Says He Has No Intent to Prioritize Payments if Debt Limit Isn’t Raised,” The Wall Street Journal online, July 27, 2017 11:56am